Credit card debt is a topic that is tough for most people to indulge in discussing, mostly because everyone has debt and paying it off can be difficult if not feeling nearly impossible.
So when it comes to tackling debt in the form of credit cards, you might be willing to entertain just about any option that you can think of, even if it means adding to the pile.
Consolidation is paramount for some, simply for convenience purposes of making one payment and calling it a day. The consolidation road can center on two avenues: debt consolidation companies that overtake your debt and help you manage it or quite simply a personal loan that can use its Superman like qualities and knock out your debt in a single swipe.
The debt consolidation plan through a company works, but that renders your credit cards cancelled and obsolete and will ding your credit score as a result. It doesn’t mean you’ll not be able to have credit or get more important loans, but that is a deterrent for the masses.
A personal loan allows you to have a fixed interest rate (which is a breath of fresh air versus doing balance transfers on credit cards that change drastically once the promotional rate that is introduced goes away after 12 or 18 months).
Before going into a personal loan, you have to make sure you’re able to carry something like that, first by checking your credit score but also making sure you’re not going to get saddled with a high interest rate based on your debt to income ratio or income in general.
If you don’t have the income to carry personal loan, what ends up happening is you borrow less than you need to consolidate and still have a stray card or two to pay on in addition to paying back that personal loan.
The real selling point of the personal loan is that one stop shopping (or paying back) mentality. The personal loan can take multiple lines of credit and allow them to be paid off and that one lump sum monthly is important for the purposes of convenience. That is hard to understate for the people who have a lot of debt and a lot of cards they’re trying to manage.
Having credit card debt is troubling and disheartening but it doesn’t have to be a mountain that you can’t climb. Taking a personal loan should mean that, credit wise, you can carry it with an interest rate that only alleviates the problem, not adding to it.